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Workers comp risks shift as jobs return

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A modest rebound in post-recession hiring has experts keeping an eye on work-related injuries associated with new employees as well as those returning from extended unemployment.

Though workers who change employers typically are at higher risk for injury, sources say rehired employees also can pose safety concerns when returning to their former employers after months or even years off the job.

“Those employees who are coming back are at just as high a risk for injury as those people who are brand new and trying to learn,” said Mark Noonan, managing principal at Integro Insurance Brokers Ltd. in Boston.

The national unemployment rate was 8.3% in January, according to the U.S. Bureau of Labor Statistics, the lowest jobless rate since February 2009. The number of job openings increased somewhat in 2011 after two years of declines (see chart).

That modest job growth appears to be contributing to a recent uptick in work-related injuries. The frequency of workers compensation claims increased 3% in 2010, according Boca Raton, Fla.-based NCCI Holdings Inc.

The ratings and research organization said the increase—the first since 1997—likely was due in part to the “firming job market and (a) modest increase in employment since the start of the recovery in the middle of 2009.”

Texas Mutual Insurance Co. has seen employer payrolls increase and workers comp claims rise during the past six months, a spokesman said.

Much of the growth for the Austin, Texas-based insurer of last resort is coming from the oil and gas industry, which is “booming” right now and hiring new and laid-off workers, he said.

“Here in Texas, there's no doubt in our mind that the economy is rebounding,” he said.

NCCI Chief Economist Harry Shuford said workers are at greatest risk of injury during their first year with a company, regardless of whether they change positions within that firm. The risk level drops once an employee has been with a company for five years.

Employees who are learning to perform new jobs correctly pose much of the injury risk, Mr. Shuford said.

So far, it's difficult to determine whether the injury clock resets for workers who leave and then return to a company. However, Mr. Shuford said, he believes that rehired workers could pose more safety concerns than those who continued on the job.

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“If you've been away for an extended period of time and have now returned, it will still take you a while to get back in the groove,” he said.

Integro's Mr. Noonan said laid-off employees sometimes return to work operating new machinery that could increase their risk of injury.

Workers in physically demand-ing positions also could lose muscle conditioning while off the job, which also increases their risk of injury when they return, Mr. Noonan said.

Additionally, rehires and new hires may feel extra pressure to perform their jobs well, which could lead to overexertion and injury, said Paul Braun, managing director of casualty claims at Aon Global Risk Consulting in Los Angeles.

“Because people are very...desperate to get a job, there's a tendency to say "I'll do everything' or "I can do everything,'” Mr. Braun said.

Safety for rehired workers is a focus for General Motors Co.'s Toledo transmission plant in Ohio. The facility has been adding jobs recently, most filled by laid-off GM workers, said George Williams, human resources manager for the transmission plant.

Though the employees are experienced with GM plant work, Mr. Williams said many of the Toledo jobs require workers to operate unfamiliar machinery.

“Our plant is a manufacturing plant...and a lot of people transferring in are from assembly plants,” Mr. Williams said. “The work is similar in that it has hazards, but unique in that the processes are different.”

GM requires new and returning workers to complete an extensive orientation program, including safety training, to help lessen their risk of getting injured, Mr. Williams said.

Training employees to properly perform their roles is a critical safety procedure for all companies, whether dealing with new or rehired workers, Mr. Braun said.

Companies hiring laid-off workers can benefit from making a checklist of procedures and policies that have changed since an employee last worked, which can be reviewed with rehires. Employers also should conduct thorough employment screenings and check references to ensure that new hires are qualified to perform their jobs safely and effectively, he said.

Companies should ease workers into their jobs to reduce injury risks, Integro's Mr. Noonan said. While rehired employees may be experienced in their jobs, it could take time for them to reach the same productivity level of peers who stayed on the job.

“It certainly might be a week or two to get to the point where they have the physical strength...and understanding of the job,” he said.

Mr. Noonan said he believes that protecting new hires will be among the top safety issues for employers as the economy gradually recovers.